Observers agree that depletion rates and the effect of new technology are two of the bigger factors that must be weighed when trying to measure the world's oil supplies. But a panel of experts at a recent Houston conference, sponsored by the James A Baker III Institute for Public Policy, disagreed about their relative effect and came to some wide-ranging conclusions about the future. Michael Lynch of the WEFA Group pointed out that warnings about the end of the world's oil supply have been consistently wrong since the 1970s. Analysts often use terrible data, there are numerous variables and it's easy to mismeasure one's efforts, he said. Between 90% and 95% of forecasts underestimate the world's resources, in part because improvements in technology and infrastructure are often omitted, according to Lynch. Forecasters often predict a near-term peak in production rates outside of the Middle East incorrectly because they overestimate depletion rates, he said. The world actually has forgotten about depletion in making its forecasts, maintained Matt Simmons, president of Simmons & Co. International in Houston. In 1999, supplies from outside OPEC and the former Soviet Union dropped for the first time in 30 years, he said. Yet drilling soared between 1995 and July of 1998, Simmons said. He explained the apparent contradiction by noting that technology has enabled fields to hit peak production quicker, newly discovered fields are much smaller than the giant discoveries of years past, and exploration drilling has taken a back seat to development drilling. There have been no supergiant fields discovered since 1976, Simmons maintained. Two out of the three existing supergiants are producing at 20% to 30% of capacity, and the third requires heavy investments in tertiary recovery to fight decline, he said. Deep water may be the industry's salvation, but it remains largely unproved, with many of the big discoveries announced from the results of just one well. "There are big energy problems ahead," Simmons predicts. Roger Anderson of Columbia University has a more optimistic view. Addressing whether technology gets more oil out of the ground or just gets the oil out quicker, he cited instances worldwide where technology lengthened the field's life, including in the deepwater Gulf of Mexico. "The assumption that deepwater turbidites bleed off faster has not been proven yet," Anderson said. But he cautioned that technology is used on the biggest and best fields first, and results later may not match today's examples. Thomas Ahlbrandt of the U.S Geological Survey summarized some of the findings of the five-year project, World Petroleum Assessment 2000, which was to be released in mid-June. The goal was to assess the recoverable, undiscovered conventional oil and gas resources of the world. The report looked at eight regions of the world, not including the United States: the former Soviet Union, the Middle East and North Africa, Asia Pacific, Europe, North America (outside of the United States), Central and South America, Sub-Saharan Africa and Antarctica, and South Asia. In total, these regions contain a mean of 649 billion barrels of undiscovered oil, 4,669 trillion cubic feet of undiscovered gas, and 207 billion barrels of gas liquids, according to the study. Ahlbrandt said that the world's supplies are quite mature, with 75% of the oil resources and 66% of the gas resources already known. Jack Zagar of Malkewicz-Hueni Associates said the world contains an ultimate resource base of 1.8 trillion barrels of conventional oil, 46% of which has already been produced and 91% of which already has been discovered. World production will peak in 2005; its peak discovery rate was in 1965, he said. -Jodi Wetuski